Competition Bureau recommends:
Canada's self-regulated professions, which includes real estate brokerage, should re-examine their rules to ensure they serve a public good and do not go too far in restricting competition, a Competition Bureau study says. The Bureau's study, released today, found that rules that limit advertising, set prices for services and restrict who can offer services may go further than necessary to protect the public interest. Further, these rules can lead to higher prices, limit choice and restrict access to the type of information consumers need to make decisions.
"We understand that regulation plays a legitimate role in protecting consumers and meeting public policy goals," said Sheridan Scott, Commissioner of Competition. "However, not all the regulations we looked at appear necessary, and removing some of these restrictions could benefit consumers and the Canadian economy."
One of the findings: Consumers generally pay less for services when professionals compete on price. In real estate, Ontario legislation limits price competition. The Bureau recommends clients be able to choose the real estate services they want from a menu of offerings. Specifically, Ontario legislation dictates consumers pay either a flat fee or a percentage of the selling price. The Bureau recommends real estate regulators remove this restriction.
December 11, 2007 in Real Estate Regulations | Permalink | Comments (0) | TrackBack
Maureen's "phantom" phantom bids
The secret's out. "It's one of the oldest tricks in the book."
The incoming head of the Toronto Real Estate Board has come out swinging against phantom bidding tactics after denying they even existed when she ran for the job three months ago. "It's dirty realty, it really is," Maureen O'Neill said of agents who fabricate offers during bidding wars. She is now calling on the Real Estate Council of Ontario (RECO) to yank the licences of agents convicted of using phony bids.
O'Neill made her comments after learning that the Toronto Star had received documents proving the Real Estate Council of Ontario has been called upon to deal with complaints about bidding war tactics. Until this week, she steadfastly refused to acknowledge made-up bids occur, saying the Ontario council's CEO Tom Wright and registrar Allan Johnson assured the Toronto Real Estate Board's directors on July 19 that no complaints had ever been received.
But the Ontario council's spokesperson Sandra Gibney said Friday that Wright and Johnson made no such statements and that "RECO does not know why Maureen O'Neill is claiming otherwise." Ms. Gibney added in an emailed statement, "If Ms. O'Neill had contacted RECO prior to responding to questions about RECO's complaints statistics, RECO would have provided the same information that you (the Toronto Star) received".
Read more about "phantom bids" in the Toronto Star, here and here ...
September 16, 2007 in Real Estate Regulations | Permalink | Comments (0) | TrackBack
Toronto's new taxes still in question
Vote on new taxes expected to be tight after heavy lobbying
Mayor Miller's plan to impose two new taxes is expected to face a tight vote at Toronto city council next month, as lobbyists fighting the levies make last-ditch efforts at city hall. Saying Toronto needs new sources of revenue to deal with its budget shortfall, Mr. Miller and his executive committee this week endorsed two new taxes: a 2% tax on land purchases and a $60 fee on motor-vehicle registrations.
The levies, made possible with new powers granted to the city by Queen's Park, would come on top of provincial taxes already paid on these transactions. Both the Toronto Real Estate Board and the Canadian Automobile Association have been meeting with city councillors to attack the new taxes, as have other lobbyists.
With the mayor's core conservative critics set to vote against the new taxes, and a list of left-leaning supporters expected to support him on a crucial vote, one lobbyist says he is focusing on council's political centre as the July meeting approaches.
"There's the mushy middle, which we've obviously been trying to go after," said Von Palmer, the Toronto Real Estate Board's government-relations director, who estimated he had met with half of the 44-member council.
"...The question is, can you get enough of those people to make a difference?"
Councillor Denzil Minnan-Wong, a vocal conservative critic of Mr. Miller who opposes the new taxes, says the real lobbying is coming from the mayor and his office.
June 27, 2007 in Real Estate Regulations | Permalink | Comments (1) | TrackBack
Toronto market is hot ... and shady
Dissident campaigns to head Toronto Real Estate Board
Michael Manley is an honest broker who cares about transparency and integrity in the real estate brokerage business. Is he about to be crushed by the Great Real Estate Cartel? A revealing article about problems in the Toronro real estate marketplace appears in today's Toronto Star.
In part it says:
"There's definitely a culture of greed that you didn't really see 10 years ago," says Michael Manley, from his office at the Prudential Properties brokerage he owns in the Beach.
He says he's heard enough stories about agents stretching and breaking the laws governing the industry. He wants transparency, including an open online bidding system to stop unfair practices when multiples offers on a property come in.
That's what he's promising if voted in as president-elect of the Toronto Real Estate Board. The weeklong election began last Friday, with 25,500 agents able to vote.
Manley's only opponent, Maureen O'Neill, counters that the system works. "I am completely opposed to Mr. Manley's platform. I believe the current market with the multiple offers is simply a supply and demand situation. It's proven it's successful, it works, it's excellent."
Asked about unethical practices, O'Neill replied that, "we have a mechanism within the industry, through RECO (the Real Estate Council of Ontario) to look into that. It's simply not a problem.
"I'm not disputing that that can happen," she explained.
Manley says without a transparent offer system, listing agents control all the information in multiple offer situations. For example, this makes it almost impossible to verify if competing offers are actually registered or if agents are divulging offers to their own clients, letting them know what to bid by doing so.
See full article in the Toronto Star »
June 13, 2007 in Real Estate Regulations | Permalink | Comments (1) | TrackBack
Competition Bureau investigates MLS
The federal Competition Bureau is investigating whether recent moves to limit access to the Multiple Listing Service (MLS) are anti-competitive."I can confirm that the Competition Bureau is opening an inquiry into whether the MLS rules are raising competition concerns under the Competition Act," bureau spokesperson Marylyne Nahum said Monday.
The Competition Bureau says the MLS system is used in 90 per cent of Canadian real estate transactions. The formal inquiry is targeting the possible violation of the act's provisions dealing with conspiracy and the "abuse of dominant position." The Canadian Real Estate Association (CREA) said Monday its current MLS policies and new interpretations comply with current competition and trademark law.
"Members of the Canadian Real Estate Association, which owns the MLS trademark, have passed seven interpretations designed to clarify how existing MLS rules are applied," said association spokesman Bob Linney. "The interpretations deal with requirements for anyone wanting to use the MLS trademark."
In the past, discount brokers have charged that CREA has been trying to squeeze out the discounters, who do most of their business online. CREA says it merely wants to protect the association’s MLS trademark.
The Competition Bureau said it has obtained a court order that requires the real estate association to produce documents relating to its MLS rules. In an affidavit, the bureau said information from the industry indicated that about 90 per cent of residential real estate transactions in Canada involve the MLS database.
Last November, Realtysellers Ltd. suspended operations, "pending resolution" of the MLS trademark dispute. The Toronto-based company gave rebates to buyers and sellers who used its services. It also advertised a $695 listing fee for private sellers who want their home on the MLS.
March 26, 2007 in Real Estate Regulations | Permalink | Comments (1) | TrackBack
What is RECO?
The Real Estate Council of Ontario (RECO) is responsible for administering the Real Estate and Business Brokers Act, 2002 (REBBA 2002) and associated regulations on behalf of the Ontario Ministry of Government Services. RECO regulates the activity of trade in real estate in the public interest for the province of Ontario
In order to trade in real estate in the province of Ontario you must be registered, or exempt from registration, under REBBA 2002. Currently, there are more than 3,800 registered real estate brokerages and more than 44,000 registered real estate brokers and salespersons in Ontario.
Only those brokerages, brokers and salespersons that have met the requirements for registration and hold a valid certificate of registration issued by RECO may trade in real estate in Ontario and hold themselves out as a “real estate brokerage”, “real estate broker” or “real estate salesperson”.
February 27, 2007 in Real Estate Regulations | Permalink | Comments (0) | TrackBack
Montreal mayor wants more tax
Montreal's mayor says his city is struggling financially and needs to be allowed to collect new taxes. Mayor Gérald Tremblay said Thursday that he's asking the province of Quebec for more "administrative and fiscal responsibilities."
This would mean he could tax items like parking, real estate transactions or entertainment events.
He is looking for a deal similar to the one Toronto secured in June 2006, when the Ontario government passed a law allowing Toronto to institute municipal taxes on alcohol served in bars and restaurants.
The law also allows Toronto to collect on movie and concert tickets. The Ontario law went into effect January 1.
Tremblay said he plans to meet with Quebec Premier, Jean Charest, soon.
January 20, 2007 in Real Estate Regulations | Permalink | Comments (0) | TrackBack
No Law Society regulation
The Ontario Real Estate Association (OREA) has succeeded in its push to amend legislation that would have made Ontario REALTORS® subject to regulation by the Law Society of Upper Canada (LSUC). The Access to Justice Act, 2006, will include an exemption for all individuals registered under the Real Estate and Business Brokers Act, thanks to OREA’s lobbying effort.
The act will regulate paralegals in Ontario by the LSUC. The act originally stated that an individual who “drafts, completes or revises a document that affects a person’s interests or rights to or in real or personal property” is considered to be providing legal services, which would have come under LSUC regulation.
"This is an important victory," said President Tim Lee. "REALTORS® are already well-regulated, and more regulation would only cause confusion in the minds of consumers, increase red tape for real estate businesses and impose a new tax on the profession in the form of LSUC license fees."
OREA also took the position that not only was extra regulation unnecessary, regulation by members of the Law Society posed a potential for abuse by the legal profession. Allowing lawyers, some of whom work in the real estate industry, the authority to impose restrictions on what REALTORS® may or may not do, would have given them the power to reserve work for themselves and shut REALTORS® out of work they currently perform.
The amended legislation passed third and final reading in October, and is expected to receive Royal Assent shortly.
November 14, 2006 in Real Estate Regulations | Permalink | Comments (0) | TrackBack
Real estate advertising
Advertising requirements under the Real Estate and Business Brokers Act 2002 include:
Salesperson
All advertising must use the terms "salesperson", "real estate salesperson", "sales representative" or "real estate sales representative" to describe a salesperson.
Associate Broker
You can continue to use the term "associate broker" until April 1, 2008 or you can use the terms "broker" or "real estate broker" as of March 31, 2006.
Broker
The terms "broker" or "real estate broker" describe a broker. The broker of record may use these terms prior to January 1, 2007.
Broker of Record
Effective January 1, 2007, all advertising must use the terms "broker of record" or "real estate broker of record" to describe a broker of record. Prior to January 1, 2007, a broker of record may use the terms "broker", "real estate broker", "broker of record" or "real estate broker of record".
Brokerage
Effective January 1, 2007, all advertising must use the term "brokerage" or "real estate brokerage" to describe a brokerage. Brokerages may use these terms prior to January 1, 2007.
Sole Proprietors
Effective January 1, 2007, a sole proprietor should be identified as both a brokerage and a broker of record. Prior to January 1, 2007, a sole proprietor may use the terms "broker", "real estate broker", "broker of record" or "real estate broker of record".
"REALTOR®"
The Real Estate Council of Ontario has been receiving a number of calls regarding the use of the term "REALTOR®". While "REALTOR®" is not a term under REBBA 2002, it can be used by anyone who has the authority to do so under the terms of their Membership with the Canadian Real Estate Association, as long as it is not used in place of the registration status, which must be clearly identified.
November 2, 2006 in Real Estate Regulations | Permalink | Comments (0) | TrackBack
